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Hospitals illegally claimed $4 million in education funds, says OIG

The agency placed the bulk of the blame on the Centers for Medicare and Medicaid Services, and the agency has signaled intent to tighten oversight.

Jeff Lagasse, Associate Editor

A federal audit conducted by the Department of Health and Human Services' Office of the Inspector General finds that hospitals are fraudulently claiming graduate medical education funds.

The agency uncovered $4 million in excess Medicare GME reimbursement, mostly among teaching hospitals that claimed reimbursement for residents at other hospitals. Some hospitals also counted residents twice.


GME funds cover the costs of education initiatives and activities at hospitals participating in the federal coverage program, and are paid for by Medicare,


The impact could be greater than initially reported by the OIG, simply because the audit only focused on certain parts of the country.

The agency placed the bulk of the blame on the Centers for Medicare and Medicaid Services, with OIG claiming CMS had inadequate procedures in place to determine whether a resident was working at multiple hospitals, for instance, or whether hospitals were counting residents as more than one full-time employee.

CMS, seemingly in agreement with the findings, is currently in the process of starting a national database of residents and interns, whereas previously that information was tracked by Medicare contractors.


According to a report earlier this year commissioned by the Association of American Medical Colleges, a 1997 cap on Medicare support for GME has stymied the necessary commensurate increases in residency training, creating a bottleneck for the physician workforce.

The looming physician shortage represents a dire situation for the state of healthcare in the U.S., as many experts predict that demand for health services will soon exceed the industry's capacity to provide care.

Twitter: @JELagasse

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